Chattanooga: Ethanol terminal move delayed

March 15th, 2011by Ellis Smith in Business Around the Region

Staff Photo by Dan Henry -- Soddy-Daisy resident Neville Lewis carries a gas tank he just filled to his fishing boat while at the On The Run Mobil gasoline station off Hixson Pike. The Mobil station switched over to carrying ethanol-blended gasoline just over a month ago.

Englewood Enterprises suffered a setback Monday when a local planning board deferred for a month its plan to shift a Chattanooga ethanol transfer facility to Bonny Oaks Industrial & Office Park.

Kevin Condra, president and CEO of Englewood, said the facility would be the first of its kind in the Southeast. He hopes to profit from new EPA guidelines allowing gas stations to distribute a 15 percent ethanol mix to motorists with the new facility.

The plan is for trains to drop off ethanol, and trucks will distribute it to four nearby mixing facilities where it is blended with gasoline. The fuel then would be transported to gas stations.

Long term, Condra wants to install pipelines to pump the ethanol directly to the mixing stations.

"The whole key to this is to take the trucking out of it. It's more cost effective, and it's safer," he said.

The facility off Jersey Pike would cut traffic congestion involved in serving the existing transfer station on Manufacturers Road, across the street from Greenlife Grocery on Chattanooga's North Shore. City Council Member Sally Robinson said the North Shore area is better suited to other commercial and residential development

"There are other uses more compatible with the surrounding development near Greenlife," Robinson said.

Mike Price, owner of M.A.P. Engineers, said meeting the EPA's 15 percent ethanol target could require 3,000 additional trucks per year, for a total of 9,000, to mix ethanol with local gas supplies, Price said. By rerouting trucks to Interstate 75 east of downtown instead of across Interstate 24 and through downtown, the plan would reduce transport costs and keep trucks off the road.

But the Regional Planning Agency, in its presentation to the Chattanooga-Hamilton County Regional Planning Commission, said the plan will run afoul of 25-year-old zoning laws and covenants in the area.

The Bonny Oaks Industrial & Office Park is zoned for business and technology use and is not intended for fuel storage uses.

However, areas just west of the park are used for fuel storage and other heavy industrial uses.

Nearby business owners cautioned against putting a potentially explosive material in a business park that is home to UPS, Frito-Lay and Mac Paper.

"Our contention is, if I could put it somewhere else, I would," Condra responded.

Developers are eager to build on the land south of Manufacturers' Road where the transfer station is.

Allen Casey sold a 5-acre tract to Chattanooga businessman S. Jackson Wingfield III for $2.9 million in 2008, though a rail line running through the property splits the valuable land in half.

Though the facility won't be used for ethanol, other ventures at the North Shore location continue to be profitable, Condra said, and will remain for some time.

"The primary thing with the Manufacturers Road site is it has river access," he said.